Looking at the stories coming out of China, it’s increasingly clear that we were rather shortsighted in 1999 in fighting to keep labour standards out of the mandate of the WTO.

A thread
In 1996, in the inaugural WTO ministerial in Singapore the US tried to introduce what would be called a “social clause” in multilateral trade agreements. This would make certain labour standards mandatory in all member countries.

The motion failed in Singapore. It was defeated mostly by developing countries who saw it as a means to negate their low cost labour advantage. They argued it amounted to using labour standards as a form of protectionism.

(An understandable argument at the time.)

In the second ministerial at Seattle in 1999, the issue became obfuscated in extreme statements of national pride and against external interference in labour matters, especially in the Indian delegation. We stormed out saying “we cannot drink one drop of poison”

At the time, this position was cheered by some on the left. Stuck in an old first world versus third world narrative, left leaning papers spoke strongly against the US/ developed world and their attempts to bulldoze labour standards into trade.

In the middle of all the jingoistic hullabaloo, we missed a critical point. Taking labour standards out of the mandate of trade agreements may have given us some gains, but the real beneficiaries of the move were countries like China.

Without labour standards on the table, we lost out in a few ways: First, we were unable to restrict Chinese goods (even goods made by unpaid or prison labour) from flooding our own markets without resorting to tariffs

Second, our so called “cheap labour” advantage was steadily chipped away by countries with even cheaper labour (Bangladesh, Vietnam etc). And our advantage over these countries - long standing systems to protect labour rights- gave us no competitive advantage.
Third, there was no accepted multilateral framework for countries with functioning labour standards to push back against Chinese manufacturing. As a result of which, the only way left to compete has been a sort of race to the bottom on labour standards.

20 years later, the effects of this on India are apparent. Stagnant manufacturing and the governments only ideas to kick start manufacturing are to trample down further on labour laws like working hours and rueing the fact that “too much democracy” affects our competitiveness.

It’s not as if Indian manufacturers don’t follow labour standards now. A number of private contracts with leading manufacturers (like the Apple Wistron situation showed us) include labour standards in their contracts.

But without a multilateral trade + labour framework, there is no way for us to ensure consistency in enforcement of labour standards by private companies in various jurisdictions. I.e, we don’t know and cannot enforce what an Apple does in China.
Ultimately, the last year has taught us that unilateral trade wars with China benefit no one.

If we’re serious about taking on China, we need to think about bringing multilateral agreements to include labour standards back on the table.

It will also give us a framework to decide what labour reforms are just long overdue simplifications of process and what hit at the core of acceptable labour standards.

But this won’t happen until the people leading our economic discourse stop seeing the Chinese growth story as some of model to ape.

Our democracy and long standing framework for labour rights should be seen as an advantage not “too much democracy”. We should work to strengthen both, and then join with countries that share those values to curb exploitative manufacturing globally.

That’s not just a bleeding heart talking. It’s the only viable way forward for our manufacturing sector.


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More from @sarayupani

28 Dec 20
Leaving aside the rather childish retort at the end, there are some flaws in this common line of thinking that I’d like to address.


It basically starts from the belief that an electoral mandate legitimises all legislative actions by the government.

It doesn’t. First, we have anti- defection laws and limited scope for MPs to vote against the party position on anything.

Second, consultation and convincing stakeholders (ideally prior to enacting the laws) is an important part of the any legislative process which should never be skipped or bulldozed, no matter what the majority is.

Read 8 tweets
12 Dec 20
Ok, quick question: how many people rely on the PDS today? 67% of our population - that’s right. Over 900 million people. Anything that affects this is pretty terrifying, right?

Read on

(Remember that in addition to the PDS, all of us rely on some sort of price control over food. That’s why we are all conditioned to protest to the government about rising onion prices.)

But how exactly does the government manage the PDS and control prices?

First, procurement and MSP. Originally, this covered only rice and wheat - this now covers a series of other food crops, including pulses and oils. The state procures specified produce at a “minimum support price” announced at the beginning of each season.

Read 22 tweets
12 Dec 20
Ok, out of curiosity (and nerdiness) I looked at 2014 NCRB data. That's just a year picked randomly (within the years looked at in the Ravi paper).

The NCRB does do the sensible thing, and further breaks down farmer suicides into sub categories

Poverty, illness, marriage related issues (I'm assuming this includes dowry harassment), family problems, farming issues including crop failure, indebtedness, fall in social reputation, alcohol abuse and other causes.
Economic distress manifests in different ways. The last straw for different farmers killing themselves might be different - illness without the option to stop working, family harassment, alcohol addiction, fall in social reputation, indebtedness, crop failure etc

Read 4 tweets
12 Dec 20
Ok, I actually read the paper and maybe I missed it but it doesn’t seem to ask the question of what % of these housewives come from farming households.

How do you build this entire argument without addressing that?
Housewives certainly do an incredible amount of work, but it’s unpaid. So analysing them as a seperate occupation without looking at their source of family income (I.e. what does the breadwinner do?) seems like a pretty big omission here?
She goes on to talk about the leading reasons for suicide as “family problems” and “illness” but completely refuses to engage with the fact that both of these factors can be and often are linked to a lack of economic well-being.

So puzzling!
Read 5 tweets
12 Dec 20
In 2019, a law firm that worked for Adani Australia faced investigation by the Australian legal services commission for saying they will use the legal system to "wage war" on people threatening Adani- it was termed the "trained attack dog strategy"

Since then, their lawyers in Australia have hounded activists, with legal charge after legal charge to the point of bankruptcy.

They've tried to barge into activists homes

Read 4 tweets
12 Dec 20
So basically now tweeting against Adani and/or coal is also an attempt to destabilise the country? And the government should intervene?

Terrifying stuff. They're literally calling a tweet-storm a plan by "outside forces"

Also, if they're convinced a cyber crime has been committed, shouldn't they should file an FIR? Why are they writing to the union government?
I mean, how do you say "look, people on twitter are falsely calling us crony capitalists" and then immediately urge the government to treat an attack on your company as an attack on the stability of the state??
Read 4 tweets

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